Retail doesn't move markets. Institutions do.. and they don't post about it. I'm Hamilton. 17 years trading, three bear markets, still standing. Every morning before the open I show you where the big money's actually moving.. what it's buying, what it's leaving, and what I'm doing about it. 3 minutes, free. The next big move, we're in it instead of reading about it.
Why Are Banks Rallying Before Earnings?
In Today's Letter
Next week, the biggest banks in America report earnings. JPMorgan. Bank of America. Goldman Sachs. Wells Fargo. By next Friday afternoon, every financial news outlet will tell you who beat estimates and who didn't. But here's the question I can't stop thinking about.. If traders were truly worried about bank earnings.. why are they buying bank stocks before the reports are even released? Maybe they're wrong.. maybe they're right. Either way.. The market is telling us something. The Market Doesn't WaitImagine you're buying a house. Nobody wakes up on Saturday morning and suddenly decides to spend half a million dollars. You've probably been thinking about it for weeks. Maybe months. You've looked at neighborhoods. Talked to your spouse. Run the numbers. Called the bank. By the time you sign the paperwork.. The decision was already made. Markets work the same way. Large institutions don't wake up on earnings morning and suddenly decide to buy billions of dollars worth of bank stocks. Those decisions are usually made long before the earnings call begins. That's why I spend so much time watching price and the flow of capital. Sometimes.. It tells us what institutions and investors are expecting before management says a single word. Here's What Caught My EyeTake a look at Financials. The Financial Sector ETF (XLF) just broke out to fresh all time highs. Not after earnings.. before them. Does that guarantee strong earnings? Of course not. Markets don't make guarantees. But it does tell us something. Money is flowing into Financials before one of the biggest events of the quarter. That doesn't happen by accident. Here's What's InterestingOne of the biggest mistakes traders make is assuming earnings create trends. Sometimes they do. More often.. they confirm trends that were already underway. Price isn't perfect. It gets things wrong all the time. That's why I look at capital flows as well. Where the money flows gives us an incredible edge when deciding whether or not price can be trusted. And as of this morning, over a billion dollars has flowed into the Financial sector ETF XLF over the last four weeks. Not earth shattering.. but enough to meaningfully move the sector. So if I have to choose between listening to predictions or watching where billions of dollars of capital are being placed.. I know which one I'm following. One Last ThoughtMaybe bank earnings surprise to the upside. Maybe they disappoint. I honestly don't know. But I do know this.. Institutions are rarely blindsided. While everyone is watching AI.. Financials are quietly breaking to new all-time highs. I mean no one is talking about this right now. At all. And that's the way I like it. Because sometimes the biggest opportunities are the ones nobody is talking about. Profits Over Prophets, Hamilton P.S. Quick question... Do you think Financials are correctly pricing next week's earnings? Just hit Reply with YES or NO. And if you have one, let me know your favorite bank stock to watch. If you enjoy thinking about markets this way, that's exactly what we do every day inside The Trading Initiative. |
The Trading Initiative
Retail doesn't move markets. Institutions do.. and they don't post about it. I'm Hamilton. 17 years trading, three bear markets, still standing. Every morning before the open I show you where the big money's actually moving.. what it's buying, what it's leaving, and what I'm doing about it. 3 minutes, free. The next big move, we're in it instead of reading about it.
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